The rise of the designer hotel

KristenBellstrom

You might say that Susan Lorin dresses for comfort when she’s traveling. In fact, the New York City attorney herself puts it more bluntly: “I look like a bag lady.”

On a recent trip to Scotland, though, Lorin found herself in the unusual position of fretting over her vacation attire. (”I really was nervous about it,” she says.) Why the sartorial angst? She was checking into the Hotel Missoni, a posh property that’s part of the Italian fashion brand.

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Pack your bags, label snobs. In one of the little-noticed but quirkier travel trends of recent years, brands best known for sequin gowns and logo-bedecked handbags are slapping their names on the marquees of high-end hotels across the globe. For the clotheshorse, there are the haute couture hide-outs, like Palazzo Versace (Gold Coast, Australia, and Dubai, United Arab Emirates) and Armani Hotels (Milan and, yes, Dubai).

Prefer bling? Bulgari Hotels and Resorts cater to vacationing jewelry fiends in London and other hot spots. The trend has taken a new turn lately, with brands outside the world of fashion also trying on the hotelier hat. French crystal maker Baccarat says it’s planning a property in New York City, while the first Nobu Hotel is slated to open in Las Vegas this fall.

There’s a simple reason some of the world’s snootiest companies are getting into the business of changing sheets and making wake-up calls: the economy. When the hospitality industry is booming, say experts, new brands tend to spring up, hoping to cater to an untapped niche.

Still, standing out from the crowd has gotten tougher: Since 2005, 27 new hotel brands have been announced, according to industry research firm Lodging Econometrics, which now tracks a whopping 250 brands in the U.S. (not including casino hotels). Some say that teaming up with a luxury company can provide a rare competitive edge to both sides. The brand that puts its name on the stationary gets to expand its reach, says Robert Mandelbaum, a director at PFK Hospitality Research, while its lodging-company partner gets a fresh tool to tempt luxury travelers.

Of course, travelers may get less of a thrill mixing shopping and sleeping. To begin with, it isn’t always clear who’s in charge. In fact, most designer hotels are actually run by an owner or hospitality firm rather than the famous name. But while that might be reassuring (after all, what does a necklace designer know about running a hotel?), vacationers often find that the big names don’t always offer all the usual lodging-company perks, like loyalty points or treats for frequent travelers. And fashion obsessives, for their part, could be disappointed to discover that while design houses update their look every season, hotels get a makeover more like once every five years or so—if they’re lucky.

Lodging for labels

The roots of today’s designer hotel boom can be traced back to a strip of Queensland, Australia, waterfront, where the opulent Palazzo Versace (with rooms starting at around $400) opened in late 2000. The idea for the hotel was the result of a shopping spree, says general manager Russell Durnell.

After a long day at the mall, it occurred to the 24-year-old son of the property developer that Versace is one of the few designer brands that makes furniture, linens, glassware, cutlery and more—in short, everything you need to outfit a hotel.

Development firm Sunland Group approached the designer and the pair struck a deal: Sunland would own and operate the hotel, while Versace would sign off on the design and get an on-site shop that carries its regular goods, as well as a special line of Palazzo Versace branded products. In addition, Durnell says, the hotel tries to provide guests with a taste of “the Versace lifestyle.” One recent offering: an Italian-style picnic outing on the hotel’s custom Vespas.

Today, the famous-name-hotel movement is spreading to more specialty brands. Baccarat recently announced a partnership with Starwood Capital Group to open a Baccarat Hotel in New York City in 2014.

Launching a hotel—and packing it with the company’s products, a store and a Baccarat-branded spa, bar and restaurant—will let consumers “spend more time with the brand,” says Baccarat CEO Markus Lampe. He also hopes that it might change the company’s stuffy image. “Many people might know Baccarat as a historical brand and might even think it’s old-fashioned,” says Lampe. The hotel, he says, will be full of the company’s modern glassware, chandeliers and more. “Guests will see the brand from a different perspective,” he says.

Jacey Duprie wasn’t so sure she wanted to check in to an exercise in 24-hour-a-day branding. Indeed, the Los Angeles fashion blogger says she wouldn’t have honeymooned at the Bulgari Resort in Bali were it not for the recommendation of a local friend. But to her surprise, the hotel didn’t scream “designer.” “The towels didn’t have big Bulgari logos all over them, Ed Hardy style,” she says. So while Duprie says she never set foot in the hotel’s jewelry boutique, she was impressed with the Bulgari’s food, service—including a personal butler—and luxurious private villas. “The bathroom was bigger than our condo,” she says.

Of course, fashion is a fickle business. And some of the hotels that have aligned themselves with luxury brands are discovering that even though it’s great to ride a big name’s coattails when it’s hot, that relationship can be a drag when the cool kids have moved on. “Brands wane and have their moments in the sun,” says the Palazzo Versace’s Durnell, who admits that Versace is no longer the powerhouse it was in the late ‘90s.

Hotels have experimented with different strategies to stay relevant. Some stick to only the brand’s most classic looks (think Armani minimalism or the iconic Missoni chevron print) to avoid seeming dated. When all else fails, they can always wait for the first rule in fashion to kick in: Everything old is eventually new again. The latest Versace collections are “quite retro,” says Durnell: “We’re back at the height of fashion!”

For travelers, the hotels can offer more-mundane problems. Frequent travelers who live and die by brand-loyalty points may be irked to see that even properties that are part of large hospitality companies, like the Hotel Missoni (owned by Radisson’s parent firm) and Bulgari Hotels & Resorts (Marriott International
MAR, +0.21%
), do not permit travelers to earn or redeem loyalty points. Missoni says it plans to change this policy soon, while Bulgari responds that Marriott’s role in the joint venture is to provide service and operational expertise, not to share reward programs.

In some cases, guests say the designer’s influence may be a bit over the top. James Rooney, a London hospitality consultant, says that when he checked into the Armani Hotel in Dubai, the usual two-minute room tour (during which a staffer typically explains how the remote works and where to find the hair dryer) turned into a 15-minute slog, with the employee pointing out everything that had any connection with the designer—“even down to the coffee packets with the Armani logo.”

The whole room, he says, seemed laid out to match the designer’s aesthetic, rather than a traveler’s needs, with impractically low lighting, a tiny closet and few places to put belongings. (A hotel spokesperson says the room design “reiterates Mr. Armani’s vision,” adding that most guests “take great interest in knowing the features that the fashion maestro has created.”) The one-night stay was enough to convince Rooney that the marriage of hotels and luxury brands still has a ways to go. “The image outweighs the guest,” he says.

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